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Friday, Mar 29, 2024

Burger Wars

National chain Smashburger wants to take a bite out of the region’s burger market, starting with its first location in Thousand Oaks. The Denver-based burger chain joins the Valley’s burger war, where a variety of players — ranging from fast food franchises and drive-ins to fast casual concepts and upscale eateries — are battling it out for consumer dollars. Smashburger opens its first restaurant in the greater Los Angeles area on July 11. The company also has signed a lease on a location in Culver City, slated to open in the fourth quarter, and plans to open another five to eight locations in the area in the next year. The Thousand Oaks location is located at 650 North Moorpark Road, and is situated near some of the burger industry’s major players including national chain Five Guys Burgers and Fries and regional favorites In-N-Out Burger and The Habit. “We’re not too worried,” said Smashburger CEO Dave Prokupek. “We have a different offering that has worked well for us.” Industry observers say Smashburger is positioned for success, though local competition will be a challenge. Smashburger’s biggest rival will be the long-standing regional favorite, In-N-Out, said Darren Tristano, executive vice-president of Technomic, a Chicago-based research and consulting firm focused on the food and food service industry. The 64-year-old brand, known for its classic Double-Double Cheeseburger and hand-cut French fries, has 22 locations serving the Valley. “In-N-Out’s a long-standing tradition,” Tristano said. “It has a simple menu and is very affordable so it will likely be the biggest challenge.” The Smashburger Concept Smashburger, which got started five years ago, now operates 160 locations nationwide and generates about $150 million in annual system-wide sales, Prokupek said. The chain offers a broad range of items on its menu, including hamburgers, veggie burgers, chicken sandwiches, hot dogs and salads — a selection that helps to differentiate the chain from other burger brands. Thousand Oaks was an ideal place to set up shop, Prokupek said, noting the community is family-oriented and affluent. In scoping out new locations, Smashburger targets areas with an average household income of $50,000 or more and typically situates itself near premium brands and grocers such as Whole Foods. Woodland Hills resident Amanda Joel says she eats at Smashburger on visits to Las Vegas. “They’re known for their French fries, which I love,” said Joel, 45. At restaurants such as In-N-Out, consumers select from limited menus consisting of mainly hamburgers, Joel said. “(At Smashburger,) anyone can eat there — from vegetarians to meat lovers.” The eatery also includes items that pay tribute to local cuisine. In the San Diego area, for example, Smashburger locations include a “San Diego” burger, which includes avocado, cilantro, sour cream and chipotle mayonnaise. The Los Angeles region will have its own signature burger and chicken sandwich concoction, as well, consisting of wontons, a fried egg, Japanese dressing, cilantro, cucumber, lettuce, and tomato. The Los Angeles market also will feature other new items exclusive to the area including a Caribbean burger, a spinach and goat cheese chicken sandwich, and a new double burger. “Our ideas are very data-driven,” Pokupek said. “We study what kinds of tastes and flavors people are interested in and what things are motivating people.” Burger Battle The rising popularity of hamburgers was not something food industry experts would have predicted a decade ago. “If you would have said burgers were going to be the big thing, people would have looked at you funny,” Tristano said. For decades, establishments such as McDonald’s, Burger King and Carl’s Jr. dominated the market, defining what Americans wanted in a burger. Over the years, however, fast-food establishments began to shift their focus off of their core burger offerings to new breakfast menu items, desserts and drinks. Nearly half of all American consumers now eat a burger at least once a week, up 10 percent from just two years ago, and fewer of them are eating at national fast food chains, according to Technomic. The Valley region is a clear example of the booming “better burger” market, which nationally generates some $69 billion each year. Along with In-N-Out burger, locally-known burger joint The Habit Burger Grill has been a mainstay in the Valley for years. The company got its start in Santa Barbara in 1969 and has been rooted in the Ventura County and San Fernando Valley region for nearly 40 years, said Vice President of Marketing Mike Mirkil. Companywide, The Habit operates some 60 locations, including 17 in the Valley. The company, now based in Irvine, isn’t phased by the competing establishments that have popped up in recent years. “I think there are enough customers out there to serve a number of businesses,” Mirkil said. “If we continue to execute things at a high level, we can weather any competition.” While not as widely known to the area as In-N-Out and The Habit, Five Guys Burgers and Fries also is a force to be reckoned with in the recent battle of the burgers. Tristano said the Washington D.C.-based franchise was one of the first “better burger” brands to fuel the trend after it began offering franchising opportunities in 2003. Much has changed over the past decade, and the chain now includes more than 1,000 locations nationwide, four in the Valley. Food fad? Smashburger is a relative newcomer to the burger category, which has become more crowded. Upscale eateries such as The Counter and Umami Burger also serve the area with a few local restaurants and arrived on the scene before it did. Prokupek said he launched Smashburger after seeing an opportunity in the upscale burger category. “A number of people had the idea, but our goal was to be a leader,” he said. Prices at Smashburger range between $4.29 and $7.29 for a sandwich, depending on size and toppings, while additional toppings are available for a charge. While many modern burger restaurants feature slightly higher price points than fast-food establishments such as McDonald’s and Burger King, Tristano said consumers today are willing to pay a bit more for a quality product. The burger category, he says, is far from saturated. “Americans are willing to pay more for better,” Tristano said, noting he expects at least another five years of robust growth before the category experiences fallout. Prokupek says burgers will never go out of style. “Burgers are America’s favorite food,” he said. “The demand for burgers is not slowing down ever.”

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